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(Book 32, Hadith 5) #36448
Conditions of Qirad Loan

SUMMARY: It is permissible for an investor to make a condition on an agent in qirad not to buy certain goods, but it is not permissible for the investor to make a condition that something of the profit should be his alone without the agent sharing in it.

Yahya said that Malik spoke about an investor who made a qirad loan and stipulated to the agent that only certain goods should be bought with his money or he forbade certain goods which he named to be bought. He said, "There is no harm in an investor making a condition on an agent in qirad not to buy a certain kind of animal or goods which he specifies. It is disapproved of for an investor to make as a condition on an agent in qirad that he only buy certain goods unless the goods which he orders him to buy are in plentiful supply and do not fail either in winter or summer. There is no harm in that case". Malik spoke about an investor who loaned qirad money and stipulated that something of the profit should be his alone without the agent sharing in it. He said, "That is not good, even if it is only one dirham unless he stipulates that half the profit is his and half the profit is the agent's or a third or a fourth or whatever. When he names a percentage, whether great or small, everything specified by that is halal. This is the qirad of the muslims". He said, "It is also not good if the investor stipulates that one dirham or more of the profit is purely his, with out the agent sharing it and then what remains of the profit is to be divided in half between them. That is not the qirad of the Muslims".

TOPICS
loan  *  investment  *  profit  *  qirad

QUICK LESSONS:
Make sure everyone has access to their fair share of profits from any investments made; Ensure fairness and justice between all parties involved; Stipulate percentages when making such investments; Follow Islamic principles while engaging in business transactions or investments.

EXPLANATIONS:
This hadith discusses the conditions of qirad loan, which is a type of investment. An investor can make a condition on an agent in qirad not to buy certain goods, but it is not permissible for the investor to make a condition that something of the profit should be his alone without the agent sharing in it. The Prophet Muhammad ﷺ taught us that when making such investments, we must ensure fairness and justice between all parties involved. We must also ensure that everyone has access to their fair share of profits from any investments made. This hadith teaches us about how we should conduct ourselves when engaging in business transactions and investments so as to ensure fairness and justice between all parties involved.

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